Do laptops have limits to compatibility with hardware upgrades, specifically hard drives?

I have a Lenovo Ideapad Z710 and the hard drive has died just outside the warranty. I had to replace the motherboard when it was 6 months old and the price was "not covered by the warranty" so I don't want to give Lenovo another penny. I apologize if this seems a stupid question, but talking to India always makes me lose my sense.

If I buy a hard drive with better specs than my dead one, will it be compatible with the mobo and all other hardware?

1Tb is large enough for me, but I want to upgrade from 5400rpm to 7200, and maybe even upgrade my cache from 8Gb to 16, if the price is right. I really, really want to change from Samsung to Western Digital… The physical size of the drive and SATA3 will of course stay the same. I appreciate any help with this, I just need to be sure since India has thrown me for a loop.

Yes, they can. However it's mostly size in terms of dimensions, and occasional bits of addressing the size of a HDD, but right now, it's not an issue.

Yes, it will work.

There are some limitations concerning the new hard drive - it has to be 2.5 inch form factor, 7.0 or 9.5 mm and muss have SATA interface.

As for a WD replacement drive, I would recommend either WD Black, since you're after a better performance, or WD Black Dual, which combines a 120 GB SSD partition with 1 TB HDD one. You can check them out here if you want:

WD Black - http://products.wdc.com/support/kb.ashx?id=kSXXQQ
WD Black Dual - http://products.wdc.com/support/kb.ashx?id=woVrBQ

Lastly, keep in mind that 7200RPM drives are faster indeed and you'll get noticeable faster boot time with the computer, as well as better multitasking, but they make more noise, more heat and are more battery intensive too.

Hope this helps.